Healthcare M&A Report
Q4 2016
HYDE PARK CAPITAL
Member FINRA/SIPC
Investment Banking | Mergers & Acquisitions | Capital Raising
Hyde Park Capital Advisors, LLC 701 N. Franklin Street
Tampa, FL 33602 Tel: 813-383-0202
www.hydeparkcapital.com
John Hill Senior Managing Director [email protected] (813) 383-0205 John McDonald Senior Managing Director [email protected] (813) 383-0206 Keith Hodgdon Managing Director [email protected] (813) 383-0208 Jami Gold Vice President [email protected] (813) 383-0203 Greg Bosl Vice President [email protected] (813) 597-2649 Jeffrey Hendricks Vice President [email protected] (678) 523-3073 Kenneth Burnside Business Development Officer [email protected] (864) 905-9633
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Jan-16 Apr-16 Jul-16 Oct-16 Jan-17
S&P 500 Nasdaq S&P Global Healthcare Index
Public Market Performance (LTM)
Select Public Offerings – Healthcare (Q4 2016)
Public Company Market Performance by Sector
Source: S&P Capital IQ
Capital Markets Overview – Healthcare
Major market indices including the S&P 500 and Nasdaq posted positive results adding 11.2% and 9.8% respectively, while the S&P Global Healthcare Index fell 6.0% throughout 2016.
The table to the right highlights select public offerings completed in the Healthcare industry during Q4 2016. iRhythm Technologies, Inc. (NasdaqGM: IRTC) which provides wearable biosensors, completed the largest IPO during the quarter, raising $107 million from investors.
From a valuation perspective, the Healthcare Equipment & Supplies and Healthcare Technology sectors continued to trade at strong multiples of revenue at 4.0x and 3.3x, respectively.
Commentary
(6.0)%
9.8%
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
11.2%
2
($ in millions)
Offer Date Issuer Industry Sector IPO / Secondary Offering Size
11/17/16 Abbott Laboratories Healthcare Equipment Secondary $3,225
10/27/16 Centene Corp. Managed Healthcare Secondary $1,200
12/15/16 UnitedHealth Group, Inc. Managed Healthcare Secondary $749
12/06/16 Zimmer Biomet Holdings, Inc. Healthcare Equipment Secondary $537
12/01/16 Becton, Dickinson and Co. Healthcare Equipment Secondary $530
11/10/16 PRA Health Sciences, Inc. Pharmaceuticals Secondary $416
10/19/16 iRhythm Technologies, Inc. Healthcare Equipment IPO $107
10/25/16 Ra Pharmaceuticals, Inc. Pharmaceuticals IPO $92
11/10/16 K2M Group Holdings, Inc. Healthcare Equipment Secondary $83
10/05/16 Obalon Therapeutics, Inc. Healthcare Equipment IPO $75
Industry Sector 3 Months 12 months Revenue EBITDA
Healthcare Facilities (5.5%) (3.7%) 1.0x 8.2x
Healthcare Services 0.8% 5.1% 1.8x 9.9x
Managed Healthcare 12.3% 18.6% 0.4x 7.5x
Healthcare Technology (18.3%) (19.1%) 3.3x 14.6x
Healthcare Equipment & Supplies (3.3%) 20.0% 4.0x 16.1x
Healthcare Distribution (8.4%) (20.3%) 0.3x 9.4x
Median
Change in Stock Price Enterprise Value / LTM
Deal Size Volume Value Volume Value Volume Value
Less than $100M 249 $9.1 204 $7.2 (18%) (21%)
$100 - $499M 99 $22.9 86 $19.8 (13%) (13%)
$500 - $999M 22 $16.0 30 $20.3 36% 27%
Total Middle Market 370 $48.0 320 $47.3 (14%) (1%)
% of Middle Market
Less than $100M 67% 19% 64% 15%
$100 - $499M 27% 48% 27% 42%
$500 - $999M 6% 33% 9% 43%
Total Middle Market 100% 100% 100% 100%
2015 2016 % Change
264 268
320
280
188
303
341
302
360370
320
0
100
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300
400
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
As detailed in the charts below, Healthcare Middle Market M&A transaction volume and value decreased during 2016 compared to 2015.
Middle Market Healthcare deal volume fell 14% throughout 2016 to
320 completed transactions, down from 370 during the prior year period. Despite the drop in deal volume, the total value of completed transactions fell only 1% to $47.3 billion.
Although Middle Market Healthcare M&A activity declined throughout the year, completed deal volume and deal value increased for transactions valued between $500 million and $1 billion, rising 36% and 27%, respectively.
Commentary
U.S. Middle Market M&A Activity – Annual Trends: VOLUME U.S. Middle Market M&A Activity – Annual Trends: VALUE
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Annual Middle Market M&A Activity – Healthcare
3
Source: S&P Capital IQ (middle market includes all closed deals with disclosed deal value between $10 million and $1 billion).
Less than $100M $100 - $499M $500 - $1,000M Less than $100M $100 - $499M $500 - $1,000M
($ in billions)
Middle Market M&A Transactions by Deal Size – Healthcare
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HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
$32.4
$46.0
$33.8
$22.2
$43.7
$49.7
$43.0
$35.2
$49.8 $48.0 $47.3
$0
$10
$20
$30
$40
$50
$60
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
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74
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71 74
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Q4 '13 Q1 '14 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Q3 '15 Q4 '15 Q1 '16 Q2'16 Q3'16 Q4'16
Quarterly Middle Market M&A Activity – Healthcare
U.S. Middle Market M&A Activity – Quarterly Trends: VALUE U.S. Middle Market M&A Activity – Quarterly Trends: VOLUME
Middle Market M&A Transactions by Deal Size – Healthcare
($ in billions)
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Commentary
Source: S&P Capital IQ (middle market includes all closed deals with disclosed deal value between $10 million and $1 billion)
As detailed in the table on the right, Middle Market M&A activity in the Healthcare industry fell during Q4 2016 to 65 closed transactions, a 34% decrease from the 99 transactions closed in Q4 2015.
The total value of completed Middle Market Healthcare deals fell 28% to $8.6 billion in Q4 2016, down from $11.9 billion in the prior year period largely because of a decline in transactions valued between $100 million and $499 million.
Transactions valued between $500 million and $1 billion were a bright spot during Q4 2016 as deal volume in this size range increased 75% and completed deal value rose 86%.
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Less than $100M $100 - $499M $500 - $1,000M Less than $100M $100 - $499M $500 - $1,000M
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
Source: S&P Capital IQ (middle market includes all closed deals with disclosed deal value between $10 million and $1 billion)
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Q4 '13 Q1 '14 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Q3 '15 Q4 '15 Q1 '16 Q2'16 Q3'16 Q4'16
$13.8
$9.1 $8.7
$10.4
$12.0$12.1
$16.7
$15.2
$11.9
$17.0
$11.9$11.6
$8.6
Deal Size Volume Value Volume Value Volume Value
Less than $100M 65 $2.5 46 $1.5 (29%) (40%)
$100 - $499M 30 $6.9 12 $2.5 (60%) (64%)
$500 - $999M 4 $2.5 7 $4.6 75% 86%
Total Middle Market 99 $11.9 65 $8.6 (34%) (28%)
% of Middle Market
Less than $100M 66% 21% 71% 17%
$100 - $499M 30% 58% 18% 29%
$500 - $999M 4% 21% 11% 54%
Total Middle Market 100% 100% 100% 100%
Q4 2015 Q4 2016 % Change
Recent M&A Activity – Healthcare
Select Announced M&A Transactions (Q4 2016)
5
Source: S&P Capital IQ.
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
Announced Date Target Buyer Industry
Enterprise
Value ($mm)
EV /
Revenue
EV /
EBITDA
12/22/16 Apollo Medical Holdings, Inc. Network Medical Management, Inc. Healthcare Services NA NA NA
12/20/16 LifeCell Corp. Allergan plc Pharmaceuticals $2,900.0 NA NA
12/20/16 Encore Vision, Inc. Novartis AG Pharmaceuticals NA NA NA
12/19/16 Epic Health Services, Inc. Bain Capital Private Equity, LP Healthcare Services NA NA NA
12/15/16 Capsugel, Inc. Lonza Group Ltd. Pharmaceuticals $5,500.0 5.5x 16.0x
12/09/16 First Choice Medical Supply, LLC Medical Specialties Distributors, LLC Healthcare Distributors NA NA NA
12/07/16 MedPlast, Inc. JLL Partners & Water Street Healthcare Partners Healthcare Supplies NA NA NA
12/02/16 Vascular Solutions, Inc. Teleflex, Inc. Healthcare Supplies $992.0 6.2x 45.8x
12/01/16 Edge Systems, LLC DW Healthcare Partners & Linden, LLC Healthcare Equipment NA NA NA
11/30/16 Comfort Medical, LLC Coloplast A/S Healthcare Distributors $160.0 NA NA
11/29/16 Great Lakes Home Health Services, Inc. Blue Wolf Capital Partners, LLC Healthcare Services NA NA NA
11/22/16 Chase Pharmaceuticals Corp., Inc. Allergan plc Pharmaceuticals $1,000.0 NA NA
11/17/16 Universal American Corp. WellCare Health Plans, Inc. Managed Healthcare $467.9 0.3x 18.2x
11/17/16 Veterinary Products Laboratories, Inc. Pegasus Laboratories, Inc. Healthcare Equipment NA NA NA
11/16/16 Square Waveform Anesthesiology, P.A. NorthStar Anesthesia, P.A. Healthcare Services NA NA NA
11/04/16 HealthTech Solutions, Inc. HealthTronics, Inc. Healthcare Distributors NA NA NA
Recent M&A Activity – Healthcare
Select Announced M&A Transactions (Q4 2016)
6
Source: S&P Capital IQ.
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
Announced Date Target Buyer Industry
Enterprise
Value ($mm)
EV /
Revenue
EV /
EBITDA
11/02/16 Secura Home Health, LLC Care Finders Total Care, LLC Healthcare Services NA NA NA
10/31/16 Team Health Holdings, Inc. The Blackstone Group Healthcare Services $6,020.1 1.4x 15.0x
10/27/16 Village Fertility Pharmacy, Inc. Apothecary by Design, LLC Healthcare Services NA NA NA
10/26/16 Firstaff Nursing Services, Inc. Epic Health Services, Inc. Healthcare Services NA NA NA
10/20/16 CNY Anesthesia Group, P.C. MEDNAX, Inc. Healthcare Services NA NA NA
10/19/16 Health Data Intelligence, LLC TrendShift, LLC Health Care Technology NA NA NA
10/19/16 Floragenex, Inc. Sedia Biosciences Corp. Biotechnology NA NA NA
10/13/16 Five Star Quality Care, Inc. Senior Star Management Co. Healthcare Facilities $150.9 0.1x 5.4x
10/06/16Hospira, Inc.
(Infusion Systems Business)ICU Medical, Inc. Healthcare Supplies $1,050.0 0.9x 6.6x
10/04/16 Fisher Eye & Laser Center Vision Group Holdings, LLC Healthcare Services NA NA NA
10/03/16 Fidere Anesthesia Consultants, Inc. Sheridan Healthcare, Inc. Healthcare Services NA NA NA
10/03/16 Florida Emergency Physicians Team Health Holdings, Inc. Healthcare Facilities NA NA NA
10/03/16 ClearPath Diagnostics Laboratory Corp. of America Holdings Healthcare Services NA NA NA
10/03/16 MeriCal, Inc. Linden, LLC Pharmaceuticals NA NA NA
10/02/16 East Valley Foot & Ankle Specialists, LLC Orthopedic Specialists of North America, PLLC Healthcare Services NA NA NA
M&A Activity by Healthcare Sector
% Change
% Change
U.S. Middle Market M&A Activity by Healthcare Sector: VOLUME
7
Source: S&P Capital IQ (includes all closed deals with disclosed deal value between $10 million and $1 billion). *Managed Healthcare and Healthcare Distributor transactions are included in the Healthcare Services sector.
U.S. Middle Market M&A Activity by Healthcare Sector: VALUE
($ in billions)
74%
75%
11%
19%
82%
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
41%
211%
20%
19%
77%
$3.2
$0.3
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$1.7
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$3.5
$0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 $4.5
Pharmaceuticals, Biotechnology & Life Sciences
Healthcare Equipment & Supplies
Healthcare Technology
*Healthcare Services
Healthcare Facilities
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Pharmaceuticals, Biotechnology & Life Sciences
Healthcare Equipment & Supplies
Healthcare Technology
*Healthcare Services
Healthcare Facilities
Q4 2015 Q4 2016
Q4 2015 Q4 2016
Select Announced Private Equity M&A Transactions (Q4 2016)
Financial Sponsors Activity by Sector
Private Equity Activity – Healthcare
8
Commentary
Source: S&P Capital IQ. *Includes transactions with undisclosed transaction values.
As detailed in the chart to the right, financial sponsors were active across many sectors of the Healthcare industry during Q4 2016, most notably in Healthcare Facilities with 23 announced deals.
Several notable private equity deals were announced during Q4 2016, including: Blackstone Group’s proposed purchase of Team Health Holdings, Inc.; JLL Partners’ acquisition of MedPlast, Inc. and Bain Capital Private Equity’s proposed purchase of Epic Health Services, Inc.
During Q4 2016, financial sponsors were most active in the
Healthcare Facilities and Healthcare Services sectors, announcing 23 and 10 transactions, respectively.
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HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
3
4
23
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10
Healthcare Equipment& Supplies
Healthcare Technology Healthcare Facilities Pharmaceuticals,Biotechnology & Life
Sciences
Healthcare Services
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10
15
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Announced
Date Target Buyer Industry
Enterprise
Value ($mm)
12/23/16Miami Beach Medical
Group, LLCGauge Capital Healthcare Facilities NA
12/20/16Mediware Information Systems, Inc.
TPG Capital Health Care Technology NA
12/19/16 Epic Health Services, Inc. Bain Capital Private Equity Healthcare Services NA
12/19/16 Professional Physical Therapy Thomas H. Lee Partners Healthcare Services NA
12/19/16 Lakeview Health Systems, LLC The Riverside Co. Healthcare Facilities NA
12/07/16 MedPlast, Inc. JLL Partners Healthcare Supplies NA
11/25/16Constellation Healthcare Technologies, Inc.
CC Capital Management Healthcare Technology $295
11/14/16 SciClone Pharmaceuticals, Inc.GL Capital Group & Ally Bridge Group
Pharmaceuticals $546
11/10/16 IDOC, LLC Investors Management Corp. Healthcare Services NA
10/31/16 Team Health Holdings, Inc. The Blackstone Group Healthcare Services $6,037
10/31/16 Advanced Instruments, Inc. Windjammer Capital Investors Healthcare Equipment NA
10/17/16 AHS Staffing, LLC BelHealth Investment Partners Healthcare Services NA
10/14/16Naples Center for Dermatology & Cosmetic Surgery
GTCR Healthcare Facilities NA
10/06/16 Convey Health Solutions, Inc. New Mountain Capital Health Care Technology NA
10/06/16 LLMS, LLCNew State Capital Partners
Healthcare Services NA
10/06/16 ProPharma Group, Inc. Linden Healthcare Services NA
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Jan-16 Apr-16 Jul-16 Oct-16 Jan-17
S&P 500 Healthcare Services
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Jan-16 Apr-16 Jul-16 Oct-16 Jan-17
S&P 500 Healthcare Facilities
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Jan-16 Apr-16 Jul-16 Oct-16 Jan-17
S&P 500 Managed Healthcare
Industry Sector Overview – Recent Stock Price Performance
9
Source: S&P Capital IQ
The charts included on the following pages detail the recent stock price performance by sector for the leading public companies within the Healthcare industry for the 12-month period ended December 31, 2016. The shaded section is the most recent 3-month period (Q4) for each sector relative to the S&P 500.
For the 12-month period ending December 31, 2016, the Healthcare industry had mixed performances, led by the Healthcare Equipment & Supplies sector (up 20.0%), while the Healthcare Distribution sector performed the worst (down 20.3 %)
During the 3-month period ended December 31, 2016, a majority of the sector indices decreased, with the Healthcare Technology sector declining the most during the period (down 18.3%).
Healthcare Facilities
Commentary Healthcare Services
Managed Healthcare
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
11.2%
11.2%
11.2%
18.6%
3.7%
5.1%
70%
80%
90%
100%
110%
120%
Jan-16 Apr-16 Jul-16 Oct-16 Jan-17
S&P 500 Healthcare Distribution
90%
100%
110%
120%
130%
Jan-16 Apr-16 Jul-16 Oct-16 Jan-17
S&P 500 Healthcare Equipment & Supplies
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Jan-16 Apr-16 Jul-16 Oct-16 Jan-17
S&P 500 Healthcare Technology
Industry Sector Overview – Recent Stock Price Performance
10
Source: S&P Capital IQ
Healthcare Distribution
Healthcare Equipment & Supplies Healthcare Technology
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
11.2%
11.2%
20.0%
20.3%
11.2%
19.1%
Industry Sector Overview – Public Company Analysis
Healthcare Facilities
($ in millions, except per share)
11
Source: S&P Capital IQ.
Healthcare Services
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
Closing Price % of 52 Equity Enterprise
Company Ticker 12/30/16 Week High Value Value Revenue Gross Profit EBITDA Gross Profit EBITDA Revenue EBITDA
HCA Holdings, Inc. HCA $74.02 88% $29,877 $62,275 $41,098 $15,542 $8,091 37.8% 19.7% 1.5x 7.7x
Tenet Healthcare Corp. THC $14.84 44% $1,472 $18,274 $19,787 $7,144 $2,277 36.1% 11.5% 0.9x 8.0xCommunity Health Systems, Inc. CYH $5.59 20% $622 $16,563 $18,767 $6,898 $1,918 36.8% 10.2% 0.9x 8.6x
Universal Health Services, Inc. UHS $106.38 76% $10,522 $14,178 $9,606 $4,078 $1,701 42.5% 17.7% 1.5x 8.3xHEALTHSOUTH Corp. HLS $41.24 95% $4,106 $7,338 $3,576 $1,501 $817 42.0% 22.8% 2.1x 9.0x
Lifepoint Hospitals, Inc. LPNT $56.80 75% $2,516 $5,340 $6,130 $2,009 $661 32.8% 10.8% 0.9x 8.1xSelect Medical Holdings Corp. SEM $13.25 93% $1,692 $4,636 $4,211 $738 $452 17.5% 10.7% 1.1x 10.3x
Hanger Orthopedic Group, Inc. HNGR $11.50 71% $408 $943 $1,061 $354 $159 33.4% 15.0% 0.9x 5.9x
Average 70% $6,402 $16,193 $13,029 $4,783 $2,009 34.8% 14.8% 1.2x 8.2x
Median 76% $2,104 $10,758 $7,868 $3,044 $1,259 36.4% 13.2% 1.0x 8.2x
Enterprise Value /
LTM LTM Margins LTM
Closing Price % of 52 Equity Enterprise
Company Ticker 12/30/16 Week High Value Value Revenue Gross Profit EBITDA Gross Profit EBITDA Revenue EBITDA
DaVita, Inc. DVA $64.20 82% $13,413 $22,144 $14,550 $4,084 $2,492 28.1% 17.1% 1.5x 8.9x
Laboratory Corp. of America Holdings LH $128.38 91% $13,348 $18,968 $9,295 $3,133 $1,791 33.7% 19.3% 2.0x 10.6x
Quest Diagnostics, Inc. DGX $91.90 98% $13,188 $16,716 $7,503 $2,935 $1,471 39.1% 19.6% 2.2x 11.4xMEDNAX, Inc. MD $66.66 87% $6,209 $7,935 $3,094 $1,055 $662 34.1% 21.4% 2.6x 12.0x
RadNet, Inc. RDNT $6.45 81% $301 $953 $875 $179 $104 20.4% 11.8% 1.1x 9.2x
Alliance Healthcare Services, Inc. AIQ $9.60 97% $105 $713 $500 $217 $118 43.4% 23.6% 1.4x 6.0x
Average 89% $7,761 $11,238 $5,970 $1,934 $1,106 33.1% 18.8% 1.8x 9.7x
Median 89% $9,699 $12,325 $5,299 $1,995 $1,067 33.9% 19.4% 1.8x 9.9x
Enterprise Value /
LTM LTM Margins LTM
Industry Sector Overview – Public Company Analysis
Managed Healthcare
($ in millions, except per share)
12
Source: S&P Capital IQ. *Excluded from average and median calculation.
Healthcare Technology
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
Closing Price % of 52 Equity Enterprise
Company Ticker 12/30/16 Week High Value Value Revenue Gross Profit EBITDA Gross Profit EBITDA Revenue EBITDA
Unitedhealth Group, Inc. UNH $160.04 98% $154,919 $176,626 $184,828 $43,374 $15,335 23.5% 8.3% 1.0x 11.5x
Aetna, Inc. AET $124.01 91% $43,875 $42,718 $62,476 $16,625 $5,972 26.6% 9.6% 0.7x 7.2xCigna Corp. CI $133.39 90% $34,655 $35,561 $39,252 $12,602 $3,637 32.1% 9.3% 0.9x 9.8xAnthem, Inc. ANTM $143.77 97% $38,512 $33,223 $83,354 $17,772 $5,551 21.3% 6.7% 0.4x 6.0xHumana, Inc. HUM $204.03 94% $30,768 $20,945 $54,862 $9,940 $2,778 18.1% 5.1% 0.4x 7.5x
Centene Corp. CNC $56.51 75% $8,483 $9,846 $32,839 $6,000 $1,560 18.3% 4.8% 0.3x 6.3xWellCare Health Plans, Inc. WCG $137.08 97% $6,106 $3,022 $14,216 $2,123 $621 14.9% 4.4% 0.2x 4.9xMagellan Health Services, Inc. MGLN $75.25 97% $1,833 $2,141 $4,842 $284 $238 5.9% 4.9% 0.4x 9.0xUniversal American Corp. UAM $9.95 98% $768 $636 $1,559 $228 $20 14.6% 1.3% 0.4x 32.4x*
Health Net, Inc. HNT $0.47 79% $152 $200 $228 $90 $25 39.3% 11.0% 0.9x 7.9x
Average 91% $32,007 $32,492 $47,846 $10,904 $3,574 21.5% 6.5% 0.6x 7.8x
Median 95% $19,625 $15,395 $36,046 $7,970 $2,169 19.8% 5.9% 0.4x 7.5x
LTM Margins LTMLTM
Enterprise Value /
Closing Price % of 52 Equity Enterprise
Company Ticker 12/30/16 Week High Value Value Revenue Gross Profit EBITDA Gross Profit EBITDA Revenue EBITDA
Cerner Corp. CERN $47.37 70% $16,375 $16,255 $4,633 $3,951 $1,294 85.3% 27.9% 3.5x 12.6x
Athenahealth, Inc. ATHN $105.17 63% $4,211 $4,372 $1,052 $643 $89 61.1% 8.4% 4.2x 49.2x*Allscripts Healthcare Solutions, Inc. MDRX $10.21 67% $1,916 $3,490 $1,470 $720 $133 49.0% 9.0% 2.4x 26.3x
Medidata Solutions, Inc. MDSO $49.67 86% $2,856 $2,786 $438 $333 $56 76.0% 12.8% 6.4x 49.6x*WebMD Health Corp. WBMD $49.57 73% $2,756 $2,761 $690 $433 $177 62.8% 25.6% 4.0x 15.6xQuality Systems, Inc. QSII $13.15 75% $804 $826 $494 $268 $57 54.3% 11.5% 1.7x 14.6x
Healthstream, Inc. HSTM $25.05 87% $803 $702 $223 $129 $24 57.8% 10.6% 3.1x 29.8x*Computer Programs & Systems, Inc. CPSI $23.60 40% $300 $452 $247 $107 $36 43.1% 14.8% 1.8x 12.4x
Average 70% $3,753 $3,955 $1,156 $823 $233 61.2% 15.1% 3.4x 16.3x
Median 72% $2,336 $2,774 $592 $383 $73 59.5% 12.2% 3.3x 14.6x
Enterprise Value /
LTM LTM Margins LTM
Industry Sector Overview – Public Company Analysis
Healthcare Equipment & Supplies
($ in millions, except per share)
13
Healthcare Distribution
HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising
Closing Price % of 52 Equity Enterprise
Company Ticker 12/30/16 Week High Value Value Revenue Gross Profit EBITDA Gross Profit EBITDA Revenue EBITDA
McKesson Corp. MCK $140.45 70% $32,233 $36,391 $194,267 $11,315 $4,330 5.8% 2.2% 0.2x 8.4xCardinal Health, Inc. CAH $71.97 80% $23,588 $27,254 $125,530 $6,554 $3,084 5.2% 2.5% 0.2x 8.8x
AmerisourceBergen Corp. ABC $78.19 76% $17,668 $19,381 $146,850 $4,139 $2,069 2.8% 1.4% 0.1x 9.4xHenry Schein, Inc. HSIC $151.71 83% $12,536 $14,107 $11,302 $3,171 $967 28.1% 8.6% 1.2x 14.6x
Patterson Companies, Inc. PDCO $41.03 81% $3,944 $5,029 $5,605 $1,340 $437 23.9% 7.8% 0.9x 11.5xOwens & Minor, Inc. OMI $35.29 85% $2,171 $2,623 $9,843 $1,205 $275 12.2% 2.8% 0.3x 9.6x
PharMerica Corp. PMC $25.15 72% $778 $1,162 $2,077 $329 $131 15.8% 6.3% 0.6x 8.9x
Average 78% $13,274 $15,135 $70,782 $4,008 $1,613 13.4% 4.5% 0.5x 10.2x
Median 80% $12,536 $14,107 $11,302 $3,171 $967 12.2% 2.8% 0.3x 9.4x
LTM Margins
Enterprise Value /
LTM LTM
Source: S&P Capital IQ.
Closing Price % of 52 Equity Enterprise
Company Ticker 12/30/16 Week High Value Value Revenue Gross Profit EBITDA Gross Profit EBITDA Revenue EBITDA
Medtronic, Inc. MDT $71.23 80% $100,409 $121,699 $29,012 $19,978 $8,955 68.9% 30.9% 4.2x 13.6x
Stryker Corp. SYK $119.81 97% $45,321 $49,147 $10,883 $7,276 $2,968 66.9% 27.3% 4.5x 16.6xCR Bard, Inc. BCR $224.66 94% $17,108 $17,753 $3,611 $2,275 $1,100 63.0% 30.5% 4.9x 16.1x
DENTSPLY International, Inc. XRAY $57.73 88% $11,470 $12,739 $3,420 $1,842 $727 53.8% 21.3% 3.7x 17.5xThe Cooper Companies, Inc. COO $174.93 92% $8,576 $9,809 $1,967 $1,236 $610 62.9% 31.0% 5.0x 16.1xVarian Medical Systems, Inc. VAR $89.78 84% $8,619 $8,361 $3,218 $1,361 $656 42.3% 20.4% 2.6x 12.7x
Steris Corp. STE $67.39 90% $5,676 $6,937 $2,588 $990 $574 38.3% 22.2% 2.7x 12.1xAlere, Inc. ALR $38.97 72% $3,375 $6,378 $2,385 $1,072 $318 44.9% 13.3% 2.7x 20.1x
Average 87% $25,069 $29,103 $7,135 $4,504 $1,988 55.1% 24.6% 3.8x 15.6x
Median 89% $10,044 $11,274 $3,319 $1,601 $691 58.4% 24.7% 4.0x 16.1x
Enterprise Value /
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HYDE PARK CAPITAL Investment Banking | Mergers & Acquisitions | Capital Raising Integrity | Expertise | Results
Hyde Park Capital Advisors, LLC 701 N. Franklin Street
Tampa, FL 33602 Tel: 813-383-0202
www.hydeparkcapital.com
John Hill Senior Managing Director [email protected] (813) 383-0205 John McDonald Senior Managing Director [email protected] (813) 383-0206 Keith Hodgdon Managing Director [email protected] (813) 383-0208 Jami Gold Vice President [email protected] (813) 383-0203 Greg Bosl Vice President [email protected] (813) 597-2649 Jeffrey Hendricks Vice President [email protected] (678) 523-3073 Kenneth Burnside Business Development Officer [email protected] (864) 905-9633
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